HOUSTON CONSUMER LAW ATTORNEY » Debt Collection Practices

Dateline NBC Episode: Debt Trap

Administrator — Sun, 29 Mar 2009 19:14:27 +0000

Just wanted to post other clips from the Dateline Episode “Inside the Financial Fiasco” which aired Part I “Debt Trap” on Friday, March 27, 2009. I have posted below additional video links to this episode regarding the abusive and illegal practices of some debt collectors.

Visit msnbc.com for Breaking News, World News, and News about the Economy

Dateline NBC Episode on Debt Collectors

Administrator — Sun, 29 Mar 2009 16:43:33 +0000

Dateline NBC aired a very interesting episode on it’s Friday edition of the show entitled “Inside the Financial Fiasco”. Friday’s episode pertained to the tactics and practices of the debt collection industry. Dateline NBC conducted some undercover investigations of debt collectors. I found the tactics of these debt collectors to be beyond abusive and harassing. In my opinion, the tactics used by the debt collectors portrayed in this episode were fraudulent and criminal. This episode should be a wake up call to consumer groups, regulators, and legislators that more regulations and stiffer penalties need to be adopted.

I have posted a clip from the Dateline episode below.

Visit msnbc.com for Breaking News, World News, and News about the Economy

FTC proposes changes to debt collection laws

Administrator — Sat, 28 Feb 2009 16:36:53 +0000

The Federal Trade Commission (FTC) this week recommended that debt collection laws, such as the Fair Debt Collection Practices Act (FDCPA), be overhauled and modernized to provide for more efficient disclosures, access to better information, and greater consumer protection. I am sure that creditors, debt collectors, and their attorneys will be in opposition to these proposed changes by the FTC.

A link to the article regarding the FTC proposals is provided below.

http://www.ftc.gov/opa/2009/02/fdcpa.shtm

Credit Card Defense

Administrator — Tue, 24 Feb 2009 02:59:54 +0000

As the economy becomes worse and consumers begin to become unemployed or get behind on their bills, you can be sure the debt collectors will be thriving in this environment. Debt collections are sure to raise in this bad economic cycle that we are in right now. Of course, what that means for American consumers is more harassing phone calls, letters, and lawsuits by debt collection agencies. Most consumer debt consists primarily of credit card debt. The idea of putting that expensive pair of shoes or purse on the credit card did not seem as burdensome when you had the ability to pay the bill, however, now that the economy is in recession, thousands of consumers now face constant phone calls and letters from debt collectors demanding payment. In some instances, debt collectors and credit card companies will sue a consumer in hopes of obtaining a judgment and collection payment. It is important to remember that even if you are sued by a creditor/debt collector, that you still have rights.

First of all, if you are sued make sure that you file an answer by the date specified by that particular court. Depending on the amount owed, creditors may sue you in district court, county court, or a justice of the peace court. It is important to file an answer and not let a creditor or debt collector obtain a default judgment against you in lawsuit. In fact, many creditors and debt collectors realize that a high percentage of debtors never file an answer in lawsuit. Many creditors or debt collectors business models and profit margins are based upon their expectations of debtors failing to file an answer and contesting the lawsuit. Thus, many debt collectors are unprepared to properly prove-up their cases when a consumer unexpectedly files an answer and obtains adequate legal representation to defend themselves in court. The creditor or debt collector just can not simply come into court and assert that a consumer owes them money, the creditor or debt collector must prove it by a preponderance of the evidence under the law. There are usually several elements that must be proven before a creditor or debt collector can prevail in a lawsuit. Thus, a consumer with proper legal representation will know how to put on an adequate defense in these cases. It is important that a consumer sued by a creditor or debt collector seek legal representation immediately. An attorney defending a consumer in debt collection cases should be familiar with the substantive law and the rules of evidence. A consumer law attorney would be able to assist a consumer in defending him/herself against the creditor or debt collector. For example, a debt collector must show that it has standing to sue (basically debt collector must be able to show it owns the debt), and must be able to prove how much debt is actually owed by a particular consumer. Sometimes, if a debt has been sold to many debt collectors over a period of time, a debt collector that sues a consumer might have trouble proving its case in court. In addition, there may be affirmative defenses that an attorney would assert on behalf of a consumer against a creditor or debt collector, such as statute of limitations. Under Texas law, the statute of limitations for credit card debt is generally four (4) years from the time that an account went past due and the last payment was made to the account, however there are certain exceptions to this general rule. In addition, a debtor might have potential counterclaims against a debt collector for violations of the Federal Debt Collection Practices Act (FDCPA), Texas Collection Practice Act (TCPA), or other causes of action under federal or state law.

A proper defense against a credit or debt collector may result in your case being dismissed. Of course, there may be cases in which a dismissal may not result, but a debtor may still be able to negotiate a more favorable settlement or outcome of the case. Thus, it is generally always in a consumers best interest to seek adequate legal representation and file an answer, if you have been sued by a creditor or debt collector. DO NOT LET A DEFAULT JUDGMENT BE ENTERED AGAINST YOU!!!!

What practices are prohibited by debt collectors?

Administrator — Sat, 31 Jan 2009 18:45:36 +0000

Debt collectors are not allowed to use the following harassing or abusive tactics:

* Use of or threatening violence or criminal means to harm you;
* Use of obscene or profane language;
* Advertising your debt for sale;
* Telephoning you repeatedly or continuously with the intent to annoy or harass; or
* Placing telephone calls without meaningful disclosures of their identity.

Likewise, debt collectors are not allowed to deceive consumers with the following:

* False representations that they are government representatives;
* Falsely represent that they will seize, garnish or sell any property or wages unless such action is lawful;
* False representations that you have committed a crime or that you will be arrested or imprisoned;
* Threats to communicate false credit information with any other person;
* Falsely implying that the debt collector is employed by a credit bureau;
* False representations implying that they are attorneys or that there is the involvement of an attorney in collecting a debt;
* Falsely indicating the legal status of papers or forms sent to you;
* Use of a false name;
* Misrepresenting the amount of the debt; or
* Sending you something resembling an official document from a court or governmental agency when it is not.